Antitrust Lawyer Blog Commentary on Current Developments

Cablevision Challenges FCC’s Integration Ban

In a November 27 filing with the FCC, Cablevision Systems (“Cablevision”) said the agency’s rule banning set-top boxes with integrated security functions should not require the operator to deploy CableCARD-based boxes because all of its digital set-tops already contain removable smart cards. In the filing, Cablevision requested a limited waiver of the July 1, 2007, integration ban because the company, “alone among the nation’s cable operators, already has deployed set-top boxes that use separable, removable security on smart cards.”
Cablevision “seeks either a clarification that navigation devices with separate security on removable smart cards are not ‘integrated devices’ for purposes of the integration ban or a waiver that will allow such devices to continue to be placed into service after July 1, 2007,” it said in the filing with the FCC. The FCC’s rule requires new set-top boxes deployed by cable operators as of July 1 to separate the functions for accessing TV services. The cable industry continues to lobby against the ban, drawing support this week from three Republican congressional leaders. The ban, enacted via the 1996 Telecommunications Act, is supposed to ensure that third-party consumer-electronics devices work within cable operators’ networks – using the Cable Television Laboratories-developed CableCARD hardware – by requiring cable operators to use the same standards themselves. Cablevision said it uses proprietary removable smart cards, developed with NDS Group (“NDS”), for security functions in all of its approximately 6 million digital set-top boxes in New York, New Jersey and Connecticut systems.

The NDS-developed smart cards, which look like credit cards, can also plug into a Cablevision-supplied CableCARD. That card can, in turn, be inserted into the CableCARD slot on any CableCARD-ready device, according to Cablevision. As of the second quarter of 2006, more than 12,000 customers were using Cablevision-supplied CableCARDs, the company claimed. Cablevision said that permitting it to meet the requirement of the integration ban by continuing to deploy smart-card-capable boxes “will not affect Cablevision’s continued support of CableCARDs for third-party, CableCARD-ready [consumer-electronics] devices and will not adversely impact customers’ experience with such CableCARDs.” The filing was signed by Michael Olsen, Cablevision’s vice president of legal and regulatory affairs, and was certified by James Blackley, the operator’s senior VP of corporate engineering and technology.

For more information contact:

Olev Jaakson at ojaakson@dbmlawgroup.com.